Self-employed retirement plans Nashville, TN. The independence of running your own company in Nashville, TN is one of the best aspects of working for yourself. However, this freedom often comes with a lack of security, particularly when it comes to planning for retirement, since you don't have the benefit of retirement programs through an employer. Only 13% of self-employed individuals have a workplace retirement plan, yet countless should consider understanding their retirement options. In addition to achieving a financially stable retirement, seeking advice from a financial advisor in Nashville, TN to create your self-employed retirement plan delivers significant tax advantages that allow your business to grow and succeed.
Few Nashville, TN investment consulting and retirement planning firms are as attuned to the requirements of self-employed individuals as well as Correct Capital. The father of our founder was a small business owner himself (check out our story here), and our firm have a rich history of assisting business owners in their retirement planning needs. We recognize that your business and retirement aspirations extend well past simple financial figures, and we are dedicated to create tailored solutions to meet your unique goals. Read on to discover about your self-employed retirement plan options in Nashville, TN, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a self-employed financial advisor in Nashville, TN today.
Why Nashville, TN Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals not only prepare you for the future, they also deliver tangible benefits today. From flexible contributions to substantial tax savings, working with a financial advisor in Nashville, TN enables you to create your retirement plan to suit your specific needs.
Flexibility That Fits Your Income
For those with fluctuating income from year to year, a plan like a SEP IRA or Solo 401(k) offers the option to tailor how much you save:
- Customizable Contributions: Contribute more during high-income years and cut back when income is lower, so your plan works with your current income.
- Roth Options: Opting for a Roth Solo 401(k) lets you handle taxes upfront, enabling you to withdraw without tax penalties in the future—a smart decision if you anticipate your tax rate is likely to rise in the future.
Save Money on Taxes
Plans designed for the self-employed provide powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a SEP IRA shrink your tax liability, so you can keep more of your earnings.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, providing your money more time to grow.
- State-Specific Incentives: Depending on where you live, you could qualify for extra credits as a business owner. These state-level incentives help make these plans even more advantageous.
- Retirement Savings Contributions Credit (Saver’s Credit): Qualified participants can take advantage of a credit of up to 50% of the first $2,000 they contribute a retirement plan, cutting down your tax bill even more.
Protect Your Savings With Smart Investments
Building a secure retirement goes beyond just how much you save—it’s also linked to the way you invest:
- Diversified Portfolios: Spreading your investments across varied stocks, bonds, and alternatives can help minimize exposure to risk while helping to grow your nest egg.
- Emergency Back-Up: Combining your retirement strategy and a financial buffer for your business helps you avoid dipping into savings during tough times and facing tax penalties.
Plan for the Future of Your Nashville, TN Business
Retirement planning also helps you prepare for what’s next with your Nashville, TN business:
- Selling Your Business: When selling your business, plans like SEP IRAs or Solo 401(k)s remain your personal assets and don’t transfer with the business. These accounts ensure the steady income you’ll need during retirement. Remember that while selling your business results in a capital gain, deposits into these plans are subject to yearly maximums (e.g., as much as $7,000 for IRAs or as much as $70,000 for Solo 401(k)s, including catch-up contributions, based on plan compensation).
- Minimizing Taxes: Strategically planning your contributions can reduce the taxes you’ll owe when you sell your business.
- Succession Planning: Whether you’re transferring ownership, your nest egg offer a stable foundation as you make this shift. You can also work with a financial advisor experienced in both succession and retirement strategies to help with taxes during the sale.
With the proper savings strategy, you can take control of your financial future, lower your tax bill, and establish a strong framework for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Nashville, TN Now?
Time remains one of the most important assets when it comes to saving for retirement. Beginning sooner rather than later not only allows you to build a larger nest egg but also lowers the financial burden of saving aggressively in the future. The following are reasons why it makes sense to begin today:
The Cost of Waiting
Waiting to start your retirement fund may cause a substantial impact on the savings you’ll have when you reach retirement age. The primary reason is compound interest—the powerful process where your investments earn returns, and those returns, in turn, generate even more returns. The greater time span your money has to grow, the more significant the effect of this growth.
Example: Alex and Taylor are both entrepreneurs. Both of them want to save $500,000 for retirement by age 65:
- Alex begins contributing $5,000 annually at age 30.
- Taylor delays savings until age 40 but puts away $7,500 annually to bridge the gap.
By age 65, with an assumption of 7% annual return:
- Alex invests $180,000 and achieves a total of $691,184.39*.
- Taylor puts in $195,500 but only ends up with $474,367.78*.
How Early Contributions Grow
Regular, modest investments made consistently often create significant growth. Consider this example showing the impact of compound interest:
- Starting at age 25: By investing $200 per month in a retirement plan with an projected return of 7%, you’ll grow to approximately $497,303.29* by age 65.
- Starting at age 35: Saving the same $200 per month would result in only $235,412.97* by age 65—a shortfall of over $260,000, just from a 10-year delay.
The earlier you begin, the lower your annual savings needs each year to achieve your retirement goals.
*The figures provided in this example represent estimates derived from NerdWallet’s Compound Interest Calculator, assuming a 7% annual return. Annual deposits were multiplied by the number of years to estimate total contributions. This information is intended as illustrative examples and do not guarantee future performance. Your individual results may differ based on factors such as market conditions, fees, and your unique situation. We recommend consulting a financial advisor for custom recommendations.
Take Control of Your Financial Future
If you’re self-employed in Nashville, TN, it can be tempting to put more emphasis on reinvesting in your business over saving for retirement. However, beginning a plan now enables you to:
- Take advantage of tax-free future growth or withdrawals without taxes down the road.
- Benefit from contribution flexibility that change with your income.
- Establish a financial cushion that offers peace of mind, no matter how your business changes.
Starting early, the less you’ll need to worry about making up for lost time later in life. Saving for retirement now means managing your financial future and giving yourself the opportunity to focus on your goals—both for your golden years and your Nashville, TN business.
Types of Self-Employed Retirement Plans
There are several retirement savings options designed for entrepreneurs in Nashville, TN, each providing its own benefits and trade-offs. A financial advisor will guide you to learn about the advantages and disadvantages of each option and choose the one most suitable for your needs. Generally speaking, your self-employed retirement plan options in Nashville, TN consist of:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are financial tools for retirement that include distinct tax benefits. In a traditional IRA, you can usually deduct your contributions from taxable income, and investment earnings grow tax-deferred, but money taken out during retirement are taxable. In contrast, with Roth IRAs, you contribute using income already taxed, but qualified withdrawals in retirement, including earnings, are not taxed. In both types of accounts, withdrawals don’t incur penalties if you are at least 59½.
Eligibility: While many retirement plans, such as 401(k)s, are tied to employment, IRAs, including traditional and Roth options are open to those with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs are set at $7,000, or $8,000 if you're 50 or older.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: The Simplified Employee Pension IRA serves as a retirement savings option that permits those who are self-employed to set aside a portion of their self-employment income. Contributions must come from an employer, so, as a self-employed individual, you (the employee) cannot make additional contributions above the 25% you (the employer) already contributed. If you have employees, you must contribute the same amount for them as you do for yourself. It's your choice whether to contribute a fixed dollar figure or a percentage of wages to employee accounts. A SEP IRA is a good option for businesses that experience fluctuating revenue streams. Unlike other plans, SEP IRAs don’t have expensive setup or ongoing fees.
SEPs function like standard IRAs, where the contributions are tax-deferred and withdrawals are taxed as income.
Eligibility: Both employers and self-employed individuals can establish a SEP.
Contribution Limits: Contribution limits for employees in a SEP IRA are the lesser of:
- 25% of compensation, or
- $70,000 for 2025
If you’re self-employed, the allowable contribution is based on a special calculation.
Solo 401(k)
Plan Overview: A Solo 401(k) plan, commonly known as an Individual 401(k) or one-participant 401(k) plan, is a retirement savings plan intended for companies that have no employees or if the only employee is your spouse. These plans function similarly to standard 401(k) plans, and let you make contributions as both an employer and an employee with pre-tax money. This allows for more savings versus SEPs or IRAs; however, the extra savings options may be offset by more restricted investment choices. With this type of plan, you can make either traditional or Roth deferrals, which have the same tax benefits as their IRA contribution counterparts.
Eligibility: Solo 401(k)s are available solely to business owners and their spouses may establish and contribute to a solo 401(k).
Contribution Limits: For self-employed individuals with a solo 401(k) plan, you have the ability to make two types of contributions:
- Deferrals as an employee of up to 100% of your self-employment income, up to the annual contribution limit. The contribution limits for 2025 include $23,500, or $31,000 if you are 50 or older, or $34,750 if you attain age 60-63 in 2025.
- Contributions as an employer (as an employer) are limited to 25% of your net earnings from self-employment, which is calculated as net profits less half of your self-employment tax and the deferrals you made.
Your combined contributions must not surpass $70,000, or $77,500 if you're over age 50 (in 2025), $81,250 for those aged 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: A defined benefit plan offers a structured retirement solution that provides a pre-established payout to self-employed individuals upon retirement. In contrast to the plans discussed earlier, investment returns don’t affect the payout, but enables participants to determine exactly how much they'll have in retirement. This plan is recommended for wealthier entrepreneurs who want to save a large amount for retirement and are willing to make sizeable contributions. Contributions grow tax-free until withdrawal, and withdrawals incur taxes as income in retirement.
Eligibility: Self-employed professionals operating a solo business or employing fewer than five people may establish an individual defined benefit plan, but it's typically recommended for individuals aged 50+ who earn at least $250,000 a year. Generally, good candidates for defined benefit plans tend to be:
- Business owners or partners who desire to contribute more than $70,000 (or $77,500 for those aged 50+)
- Organizations that already put in 3-4% but are open to increasing contributions
- Companies showing consistent profit patterns
- Partners or owners over age 40 who wish to accelerate savings or boost savings within a short timeframe
Contribution Limits: The contribution limit must be determined by an actuary determined by your income, age, and retirement goals. Allowable contributions are updated yearly.
The Importance of a Financial Advisor in Nashville, TN for Your Self-Employed Retirement Plan
Partnering with an advisor in Nashville, TN experienced with retirement plans for the self-employed can be an invaluable resource for self-employed individuals. They have the expertise to help navigate the complexities of retirement planning and develop a customized plan that reflects your aspirations. An expert in your area will evaluate your financial situation, determine how much risk you’re comfortable with, and guide you in selecting the best options about saving and investing for retirement. Included in what we do for you involves:
- Help you choose a plan that suits your unique requirements
- Further adapt the plan to fit you personally even further
- Formalize a plan in writing in accordance with IRS guidelines
- Organize a trust plan to manage your assets
- Help you understand the plan's terms
- Monitor and adjust your plan when necessary
- Offer continued financial education and guidance as you continue on the road to retirement
- Boost your retirement earnings by making the most of your social security
Self-Employed Retirement Plans in Nashville, TN: Correct Capital's Process
Self-employed individuals in Nashville, TN who lack the time, interest, or knowledge to handle their retirement savings strategy independently may end up overwhelmed by their choices. Through our team at Correct Capital, our Nashville, TN financial advisors handle the lion's share of your retirement planning for you, working to make meeting your future savings targets as straightforward as possible for you. We are here to assist you in setting up your self-employed retirement plan in just four steps:
- Schedule a Call: It only takes 20 minutes, a member of our advisor team can determine if our services align for you and your business. This brief introduction allows us to learn about your needs with no pressure or significant effort on your part.
- Gather Information: If we both decide to move forward, we'll gather information, including your employee count, your current financial situation, and your future objectives. This helps us create a tailored approach designed just for you.
- Review Your Plan: When we finalize a plan from the information you provide, we'll schedule a meeting and review your plan step by step to make sure it's clear and understand how it best correlates to your needs.
- Implementation and Monitoring: After we agree on your plan, we'll set everything up so you can initiate your savings journey. Over the course of our partnership, we'll have regular meetings and review your strategy to make sure it remains aligned with your goals.
Our Nashville, TN financial advisors and retirement plan consultants are fiduciary advisors, meaning they are committed by law and ethics to do what's in your best interest.
Other financial advisory services we offer in Nashville, TN include:
- Independent Financial Advisor
- Roth Conversion
- Investment Management
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
- Fiduciary Financial Advisor
Call Correct Capital for Your Self-Employed Retirement Plan in Nashville, TN
Your business isn't "just a business" to you, and your Nashville, TN financial advisors need to offer more than just good financial guidance. With Correct Capital, we take the time to get to know our clients and their businesses to provide tailored self-employed retirement plans. To every client in Nashville, TN, we provide our I.O.U. promise: all of the advice you get from us will be independent, objective, and unbiased. To take the first step on your self-employment retirement plan, reach out to Correct Capital at 877-930-401k or contact us online.
